Total Dues Of Power Producers’ Have Risen To Over 37% Year-On-Year

In Clean News, Clean Truth, Sustainability

Power producers’ total dues owed by distribution firms rose over 37 per cent year-on-year to Rs 1.33 lakh crore in August 2020, reflecting stress in the sector.

According to portal PRAATI, which was launched in May 2018 to bring in transparency in power purchase transactions between the generators and discoms.

power producer

In August 2020, the total overdue amount, which was not cleared even after 45 days of grace period offered by generators, stood at Rs 1,20,439 crore, as against Rs 78,646 crore in the year-ago period.

Power producers give 45 days to discoms for paying bills for the supply of electricity. After that, outstanding dues become overdue and generators charge penal interest on that in most cases.

In order to give relief to power generation companies (gencos), the Centre enforced a payment security mechanism from August 1, 2019. Under this mechanism, discoms are required to open letters of credit for getting power supply.

The central government had also given some breathers to discoms for paying dues to power generating companies (gencos) in view of COVID-19-induced lockdown. The government had also waived the penal charges for late payment of dues in the directive.

Overdues of independent power producers amount to 32.07 per cent of the total overdue of Rs 1,33,062 crore of discoms in August. The proportion of central PSU gencos in the overdue was 36.61 per cent.

The overdue of non-conventional energy producers like solar and wind stood at Rs 10,908.65 crore in August.

This is a Syndicate News Feed; edited by Clean-Future Team

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